Nasdaq proposes easing listing rules during coronavirus crisis

By John McCrank

NEW YORK (Reuters) – Nasdaq Inc has applied with the U.S. Securities and Exchange Commission to offer temporary relief to companies listed on its exchange with stock prices and market values that have fallen below required minimums due to disruptions during the coronavirus crisis.

Under the proposal, the minimum requirement rules will be suspended until the end of June so companies can focus on running their businesses rather than trying to satisfy Nasdaq’s listing requirements, according to a regulatory filing on Thursday. Investors will still be able to see which companies have fallen below the standards on Nasdaq’s website.

Intercontinental Exchange Inc’s New York Stock Exchange has also asked the SEC to allow it to ease its ongoing listing requirements until the end of June.

Actions taken to reduce the spread of the coronavirus have caused major disruptions for a broad swath of companies, Nasdaq noted.

For instance, many communities have ordered all restaurants and entertainment facilities to close for an indefinite period, and travel industry bookings have collapsed.

The result has been a large increase in the number of companies that have fallen out of compliance with requirements to maintain a minimum bid price of $1 for a 30-day period and a mininum market value, which depends on the listing standard the company qualified for, Nasdaq said.

As of Monday, 154 Nasdaq-listed securities were out of compliance with the $1 price requirement, 262 more had closing bid prices below $1 for less than 30 days, and another 117 securities had closing bid prices between $1 and $1.50. That compares with March 1, when 119 securities were deficient with the bid price requirement, Nasdaq said.

Similarly, as of Monday, there were seven securities that failed to meet the requirement for a minimum market value of publicly held shares, and another 22 securities below the requirement for less than 30 days, the exchange operator said. That compares with only two securities that were out of compliance with the requirement between Jan. 1 and Monday.

(Reporting by John McCrank; editing by Jonathan Oatis)